Bonded-facility for non-RMG sector to boost export by $1.5b

Experts say at a PRI seminar

Staff Correspondent | Published: 00:05, Dec 01,2017

 
 

Former adviser to an interim government Mirza Azizul Islam, National Board of Revenue chairman Md Nojibur Rahman, Policy Research Institute chairman Zaidi Sattar and executive director Ahsan H Mansur are seen along with others at a roundtable discussion organised by the PRI in Dhaka on Thursday. — New Age photo

Experts and trade leaders on Thursday demanded the same facilities including bonded warehouse scheme the readymade garment sector now enjoy for all other sectors to facilitate export diversification and boost economic growth of the country.
Non-RMG exports ranged between $5 billion and $7 billion a year during 2013-17 but effective special bonded warehouse could have boosted the exports by $1.5 billion a year, they said.
At a roundtable discussion on modernisation of SBW scheme to ensure export competitiveness and diversification, they also requested the National Board of Revenue to extend the SBW beyond 100 per cent export-oriented industries to enhance capacity of non-RMG sectors.
Policy Research Institute arranged the discussion at its headquarters in Dhaka.
Former adviser to an interim government Mirza Azizul Islam said Bangladesh needs to accelerate diversification of export goods and markets for speeding up the economic growth.
Bangladesh’s export-GDP ratio is the second lowest, after Pakistan, among 12 Asian countries with similar economy, he said.
The government must overcome the existing export situation which is heavily dependent on RMG products through providing similar incentives to other sectors, he added.
Currently, RMG makes up 82 per cent of the country’s total export basket.
Former Dhaka Chamber of Commerce and Industry president Asif Ibrahim said that the revenue board should frame policy extending the same facilities the
RMG sector now enjoys to all potential export sectors to facilitate the much-talked-about export diversification.
Currently, NBR policies including bonded facility are highly biased towards the RMG sector though some non-RMG sectors like pharmaceuticals, leather, jute and home textiles have huge potential in the export market, he said.
PRI chairman Zaidi Sattar said three export-related issues — competitiveness, diversification and anti-export bias of policy — are deeply linked with SBW.
In last fiscal year of 2016-2017, the RMG sector enjoyed 73.37 per cent of the revenues exempted in the import stage under the SBW, he said adding that such exemption boosted export and helped the sector grow.
But, non-RMG exports are in a disadvantaged stage compared with the RMG exports, he said.
He suggested that the NBR should further extend the SBW to other sectors.
The NBR should not punish 95 per cent industries for misuse of bonded facility and leakage of bonded goods in the domestic market by 5 per cent of licence holders, he said adding that modernisation and full automation of bond system would also help the tax authority prevent abuse and leakage of customs bond benefit, he said.
Representatives from different private sectors also demanded bonded warehouse licence to industries which export at least 50 per cent of its total production.
Currently, the NBR only offers the benefit to 100 per cent export-oriented industries.
NBR chairman Md Nojibur Rahman said the revenue board took a project to automate the bonded system.
Bonded management system will be automated and run by professional and dedicated officials, he said.
PRI executive director Ahsan H Mansur, NBR member AFM Shahriar Mollah, Bangladesh Plastic Goods Manufacturers and Exporters Association president Md Jashim Uddin, World Bank Group senior economist and trade and competitiveness programme manager Masrur Reaz, representatives from Bangladesh Paper Mills Association, leather and footwear sectors spoke, among others, at the meeting.  

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